Most national mortgage lenders have temporarily stopped pursuing foreclosures, as provisions in the new stimulus package will allow for modifications of existing loans. Citigroup stopped foreclosures last month, and JPMorgan Chase, 
Morgan Stanley and Bank of America announced Friday that they were doing the same.
Fannie Mae and Freddie Mac have stopped foreclosures on owner-occupied properties, except that FHLMC will still foreclose on vacant properties.
The latest stimulus package bill has provisions to allow and/or require lenders to reduce homeowners payments by lowering interest rates and writing off principal. The details of who would qualify and how the reductions will be made are still unclear. In fact, the White House cautioned against making assumptions based on rumors in the meantime. Press secretary Robert Gibbs said that he did not want to see “an unreasonable series of expectations based on leaks from God knows where.”
Florida based BankAtlantic is one of a number of local and regional banks joining the moratorium. The actions taken by these banks make it clear that there is an expection of some serious loan modification program being enacted. The fact that banks are making these announcements ahead of the details being released make it logical to assume that the lenders will receive government compensation for the losses and write-downs.
1 Comment
March 3, 2009 at 12:36 pm
can you quiet tiltle a property if the orignial note holder sold loan but did not record. MERS – Home mortgage is on county recorder web site. MERS web sit shows Countrywide as servicer and the note was sold to Impac funding / Countrywide right after the closing. The loan was closed 8/30/05 but not recorded until 10/3/05. Countrywide will not tell me who the investor is. HJelp in Illinois please